[2] Microsoft Strengthens Existing Relationship With E-Stamp; New Agreement Includes Co-Branded Postage Microsite, Special Promotions and Exclusive Advertising Sponsorship.

SAN MATEO, Calif. and REDMOND, Wash.--(BUSINESS WIRE)--Dec. 15, 1999--

E-Stamp to Extend Reach to Hundreds of Thousands of Small Businesses

E-Stamp Corp. (Nasdaq "ESTM") and Microsoft Corp. (Nasdaq "MSFT") today announced an expansion of the strategic alliance between the two companies. Through the new agreement, E-Stamp will extend its reach to the hundreds of thousands of small businesses that frequent the MSN(tm) network of Internet services as well as bCentral(tm) online business services (http://www.bCentral.com), Microsoft's small-business portal on the Web. Through the agreement, E-Stamp will sponsor several MSN Web sites and will be the exclusive Internet postage advertiser on Microsoft bCentral. E-Stamp will also have category exclusivity in the small-business and technology sections on MSNBC. The companies will participate in a variety of activities including advertising and joint promotions. The agreement will extend the benefits of the E-Stamp(R) Internet postage service to Microsoft's online small-business customers.

The new alliance expands the existing relationship between Microsoft and E-Stamp. Microsoft was an early investor in E-Stamp and participated in three rounds of E-Stamp's private preferred stock financings. The relationship was enhanced by E-Stamp's tight integration of E-Stamp Internet Postage software with Microsoft's leading business applications, including Microsoft(R) Word and the Microsoft Outlook(R) messaging and collaboration client. Microsoft announced in July that it selected E-Stamp as the Premium Internet Postage Provider for its popular Microsoft Office Update Web site, which is frequented by millions of Office users each month.

Microsoft and E-Stamp will work together on a series of promotional, distribution and online marketing efforts. The first promotion, which began on Dec. 10, offers a free E-Stamp Internet Postage starter kit to bCentral customers who sign up for the site's $19.99 per month premium promotion services. In support of the bCentral promotion, E-Stamp's Internet Postage solution will be heavily publicized through a co-branded microsite, e-mail campaign and advertising efforts.

In the spirit of the holiday season, E-Stamp and Microsoft will also run a special promotion on the Microsoft Office Update Web site during the month of December.

"Today's news clearly demonstrates Microsoft's continued support of E-Stamp's products and services," said Robert (Bo) Ewald, president and chief executive officer at E-Stamp Corporation. "By expanding our alliance to include bCentral, a leading small-business portal, we're maintaining our strong focus on expanding our reach into the small- and home-based business markets."

"Microsoft and E-Stamp share a commitment to delivering convenient, easy-to-use tools for small-business customers that maximize their success and profitability," said Deborah Whitman, director of marketing for bCentral at Microsoft. "bCentral was created specifically to meet the needs of small and growing companies that leverage the Web to drive their businesses forward. We recognize that E-Stamp's Internet Postage service is one way we can support this charter."

"Alliances will be critical to the success of PC postage," said Raymond Boggs, VP Small Business/Home Office research at International Data Corporation in Framingham, MA. "The comprehensive nature of the Microsoft's small business Internet efforts will provide exceptional visibility to E-Stamp among the 7.5 million small businesses and 37 million home office households in the U.S. For small firms spending $50-500 per month sending letters and packages, PC postage will represent an ideal way to manage mailings like the big boys."

E-Stamp Internet Postage is the only Internet postage service that allows for the printing of digital stamps without maintaining a constant connection to the Internet.

The complete E-Stamp Internet Postage solution package costs $49.99 and includes the E-Stamp software, an electronic vault that stores postage downloaded from the Internet, and a starter kit with documentation and labels. When postage is purchased, E-Stamp charges a 10 percent convenience fee with a minimum of $4.99 and a maximum of $24.99 per purchase. There are no monthly fees or minimums.

About E-Stamp

E-Stamp provides an easy-to-use Internet postage solution that enables customers to purchase, download and print postage directly from their personal computer. The purchased postage can be printed onto envelopes, labels or documents using standard laser or inkjet printers, 24 hours a day, seven days a week, without the need to remain connected to the Internet. The company received approval from the U.S. Postal Service in August 1999 for its Internet postage solution and since then has been selling its Internet postage solution nationally. E-Stamp's Internet Postage solution is targeted at small-business, small-office and home-office users, most of whom usually connect on modems at speeds of 28.8 or 33.6 kilobytes per second and share lines with telephones or fax machines. E-Stamp has established strategic relationships with industry leaders including Microsoft, Yahoo!, Intuit Inc., Compaq Computer Corp., Excite@Home, America Online Inc., Francotyp-Postalia and Avery Dennison Corp. For more information about E-Stamp, visit the company's Web site at http://www.e-stamp.com/.

About Microsoft

Founded in 1975, Microsoft is the worldwide leader in software for personal and business computing. The company offers a wide range of products and services designed to empower people through great software - any time, any place and on any device.

Microsoft, MSN, bCentral and Outlook are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries.

E-Stamp, estamp, the e-stamp logo, e-stamp.com, E-Stamp Internet Postage and The Internet Postage Company are either trademarks or registered trademarks of E-Stamp Corporation. Other product and company names mentioned herein may be the trademarks of their respective owners.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This release may contain forward-looking statements that involve risks and uncertainties, including those regarding extension of E-Stamp's reach into the SOHO market and other benefits to E-Stamp of its distribution agreements. Important factors, which could cause actual results to differ materially from those in the forward-looking statements, include E-Stamp's ability to maintain its distribution relationships, the competitive nature of the Internet postage market and acceptance by customers of E-Stamp's Internet postage services. Additional factors that may affect our results are detailed in filings with the Securities and Exchange Commission, made from time to time by E-Stamp, including its prospectus related to its initial public offering, which was filed with the Securities and Exchange Commission on October 12, 1999.

Note to editors: If you are interested in viewing additional information on Microsoft, please visit the Microsoft Web page at http://www.microsoft.com/presspass/ on Microsoft's corporate information pages.

MEDIA GUIDELINES FOR THE USE OF THE E-STAMP TRADEMARK

As you write about E-Stamp Corporation and its products and services, please help us protect our trademark rights. The term E-STAMP is a brand name for Internet postage products and services and is a registered trademark of E-Stamp Corporation.

Please do not use the terms "e-stamp," "e-stamps," "'estamp," or "'estamps" as a generic term for postal indicia, printed postage or other aspects of Internet postage. When you write about E-Stamp Corporation's products and services, please use E-STAMP only to identify our products and services. For example, you may refer to our products and services as the E-STAMP Internet postage solution, E-STAMP Internet postage software, E-STAMP Internet postage services or, simply, E-STAMP Internet postage. Do not use "e-stamp"' or "`estamp"' as a verb (e.g., "to e-stamp"' in place of "to print postage"') or as a noun (e.g., an "`estamp"' in place of "Internet postage" or other acceptable terms set forth below).

E-Stamp Corporation's Internet postage products and services are authorized by the United States Postal Service and its information-based indicia program (IBIP). The program is designed to introduce the two dimensional barcode called an information-based indicia (IBI). You may refer to the printed postage as "`indicium,"' "indicia,"' "postal indicia,"' information-based indicia,"' "IBI," "printed postage," "printed barcode,"' "digital barcode"' or "digital stamps."'

Please contact Edward Malysz on 650/918-8614 if you have any questions concerning the proper use of our name and trademarks.